Building competitive advantage through a global network of capabilities
Article Abstract:
Facility location decisions made by many U.S. manufacturers during the past decade yielded disappointing results. These decisions were typically stop-gap actions which have resulted, at best, in short-lived benefits. Many firms moved manufacturing overseas to obtain a factor cost advantage, only to find out that the cost advantage was fleeting, and that distances the move introduced between manufacturing and other key groups (e.g., customers, suppliers, development, and sales) had constrained their ability to compete. This article explores the impact that facility location has on the critical capabilities that define a company's ability to compete. It discusses the shortcomings of the "traditional" approach to facility location, which ignores the internal workings of the company, and outlines a new capability-centered approach that creates sustainable benefits by fostering the development and growth of the unique set of critical capabilities required by a company's strategy, customers, and competitive environment. (Reprinted by permission of the publisher.)
Publication Name: California Management Review
Subject: Business, general
ISSN: 0008-1256
Year: 1993
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Hospital investment decisions and the cost of capital
Article Abstract:
An analysis of the differences in the way hospitals make investment decisions reveals that investment strategies made by for-pay hospitals are more strongly influenced by payment mechanisms than those of not-for-profit hospitals. The method of third-party payment has significant effects on investment by impacting on the cost-of-capital. Restrictive payment schemes have a negative impact on cost-of-capital, and research indicates that for-pay hospitals will likely exit those areas subject to restrictive prospective payments.
Publication Name: The Journal of Business
Subject: Business, general
ISSN: 0021-9398
Year: 1989
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The cost of regulating price differences
Article Abstract:
Business firms often choose location and technology based on the constraints of existing price regulations. Using the Robinson-Patman Act of 1936, a model is developed that indicates that firms may choose locations or technologies that would normally lose money but under the Act aids in their profit-making. In the case of cost-based pricing rules, it is shown that high-cost purchasers are often, in effect, subsidized due to relatively fixed price levels. The utility of adopting similar rules in the future is questionable.
Publication Name: The Journal of Business
Subject: Business, general
ISSN: 0021-9398
Year: 1986
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